GettyImages-1258127263.jpg

Why the Abraham Accords Matter

by Piercamillo Falasca

When, in August 2020, European policy makers and publics, became aware of the shift in the Arab-Israel paradigm — one that would redefine political and economic relations — encapsulated by the Abraham Accords, first reactions were, generally, muted.

 

The lack of European enthusiasm in that historic Washington meeting where the representatives of Israel, the United Arab Emirates and Bahrain, hosted by (then) President of the United States, Donald Trump, gathered to sign a new chapter, was based on several factors. Some cast the Abraham Accords as Trump’s publicity stunt and were loathe to support it. Others thought it was a “betrayal’ of the Palestinian cause. But reading new events with historic lens is often a mistake. 18 months since those signatures and the Abraham Accords have begun to reveal their political and commercial impact and are proving to be a salient factor driving peace and prosperity in the Middle East and wider Mediterranean region.

 

With the need for European economies to kickstart after the Covid-19 pandemic, coupled with a pending energy crisis, the European Union’s (EU) relationship to the Gulf Cooperation Council (GCC) countries is, day-on-day becoming ever more important. Strategic choices must be made. When, in recent days, reports emerged as to talks between the Biden Administration and the Qatari government on the later’s potential increase of gas supplies to Europe in the event of a gas crisis on the back of worsening tensions between Russia and Ukraine, many European observers “rediscovered” that a special relationship to the GCC is necessary and can help achieve a variety of interests. The need to reduce dependence on Russian gas and the ever stronger commitment to decarbonization inevitably lead to the strengthening of dialogue and collaboration between Europe and the Gulf—between the EU and the GCC.

 

The energy dossier is one of many where Euro-Gulf collaboration is crucial. Others include: the fight against extremism and terrorism, the safety of maritime traffic through the Mediterranean, Red Sea, Gulf and Indian Ocean, mutually beneficial trade relations and facing international challenges (re: Covid-19, climate change, etc).

 

A very common mistake of European governments — articulated in Adel Abdel Ghafar and Silvia Colombo (eds) The European Union and the Gulf Cooperation Council - Towards a New Path (Palgrave Macmillan, 2021) — is to reduce Euro-Gulf relations to the bilateral level where they are open to competition between the EU members, each guided by its own limited priority list. This approach has meant that although the EU is, by far, the first trading partner of the GCC, it does not play a significant strategic role in the region. The EU is still an economic giant and a political dwarf.

 

The time has come for a unified and comprehensive EU strategy towards the GCC countries. The Abraham Accords offer a unique opportunity to develop a political and institutional framework for the EU to strengthen dialogue and collaboration with Arab countries while assisting Israel better integrate in the region. The stability of the Middle East and the  Mediterranean littoral, the promotion of open and competitive markets, the strengthening of the rule of law, breaking down barriers to economic and commercial integration are simultaneously EU interests and enhanced by the Abraham Accords. Disengagement from cycles of conflict and the reinforcement of peaceful relations in the Middle East should come as a welcome shift for the EU long-fearful of conflict contagion in the volatile East Mediterranean.

 

For Italy, a country oriented towards the export of goods and services but a net importer of energy, the success of the Abraham Accords and the intensification of economic and commercial relations between its traditional partner, Israel and its relative new partners in the Gulf is, unquestionably, a positive development. Italy was, as a case in point, the first Western country to be hit by Covid-19 and it bore a high cost in socio-political, healthcare, economic and human terms. By 2021 however, the widespread vaccination campaign and a strict strategy to contain the virus led Italy to regain lost ground: in September 2021, Italian exports had already reached the overall level reached in the whole 2019. Nonetheless, the pandemic has hit a production and economic fabric that suffering from endemic condition for many years, with very low annual growth rates. For this reason, Italy opted, unlike other EU countries, to grant full access the EU’s Next Generation EU plan resources: €191 billion (euros), partly in the form of loans, subsidised and partly non-repayable contributions, with which the government led by (former) ECB President Mario Draghi has embarked on a profound process of modernisation of the Italian economy for post-Covid.

 

Among the main goals of the Plan, are: 1. the adoption of green hydrogen as a driver of the ecological transition, 2. massive railway, port and logistic infrastructural improvements and, 3. a robust investment in innovation and training of human capital. One of the main objectives for the €191 billion Plan is the development of the traditionally less advanced regions of the country, the South, with the ambition of making it one of the places of greatest interest for European re-industrialisation and re-shoring—a process considered by many as inevitable after the pandemic and the need to reduce production dependence on distant global supply chains. Southern Italy has long been considered as periphery by successive Italian governments and indeed by the EU.

 

Italy is changing its self-orientation and aims to regenerate the South and become a more advanced platform for Europe in the Mediterranean—a gravitational pole for production investments and a privileged entry-point of goods into the European continent. Unsurprisingly, it is around the main ports of Southern Italy that eight special economic zones have been established, with reduced taxation and bureaucracy, to attract investments and generate innovation.

 

Italy’s ambition to restore Mediterranean centrality to the economies of its southern regions makes the relationship with the signatory countries of the Abraham Accords a core element, which can induce both political authorities and Italian business communities to to focus on dialogue and collaboration with potential the Abraham Accords countries, to push for that new paradigm to expand to others and generally produce a region of stability and prosperity.

31 January 2022